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April 14, 2007

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Steve Morsa

Don, I'd guess that it wasn't Microsoft's (at least initial) intent to do so, but it looks like you guys may have come up with a great way to induce media-darling Google to waste sizable chunks of their free cash on overpriced properties...just be sure they "find out" that you (and/or the other Internet big boys) are actively pursuing a company...

Sure; DoubleClick's a nice company to own...but at 10x annual gross revenue?

I don't think so.

Applying your point about acquisition sizes...for the same 3.1 billion, Microsoft could/can buy...31 100 million dollar "something elses"...or 50-100+ 10-50 mill dollar ones...what makes more sense?

No reason to wait to add this to your list of top 10 worst billion dollar acquisitions ever. The passage of time won't change a thing on this coorporate boondoggle....

No deal, Howie. No deal.

Ola

Good post, but I thought you were going to come out and tell us why you think Microsoft was outbid by Google. Microsoft has more cash but have consistently been outbid by Google. Is Google more interested in fending off Microsoft than Microsoft is in even becoming a major player in the game?

BlogReader

Why did Google wait two years and pay billions more?

Microsoft was also in the running for DoubleClick, I'm guessing their offer was in the same ballpark. Why?

Ian Smith

Don,

The fundamental issue here is that the guys who make these decisions do not get hurt when the bubble bursts. This is just another rush of irrational exeburence and proof that markets do not have memories.

For all of its weaknesses and bureaucracy Microsoft isn't going to be put out of business by a bubble player such as Google. When the recession comes, anyone focused exclusively on superficial and discretionary consumer spending is going to hurt badly. And Google is, for sure, massively exposed to this risk.

Alberto Saavedra

When I read that Google outbidded Microsoft, I thought that Microsoft wasn't really serious about competing in online advertising but when I analyzed the price I understood the reason, there's no way DoubleClick is worth more than $3.1 billion for Microsoft.

As Don states we will only know the impact of this acquisition in the following years, but I don't think Googlers are happy with the price paid. Sure they have the potential to make it pay but Google wasn't interested in DoubleClick 2 years ago and if it wasn't for Microsoft they probably wouldn't have acquire DC either.

It all depends now on Microsoft's next move, when behavioral targeting was introduced ValueClick, aQuantive and Tribal Fusion were mentioned as possible acquisitions to increase reach (no one mentioned DoubleClick); the market will be expecting Microsoft's reaction and it has to be logical not emotional.

Andrew

Impressive article. Well written. I may have to include this as one of the best articles I have ever read.

mindmarc

>> Why did Google wait two years and pay billions more?

Because Google is expensive itself (now worth $145B!) and can use that market cap to make expensive purchases.

pat ross

Love the show of deal or no deal.try to watch all the shows I was just wandering do you ever pick someone from south carolina to go on the show,I sure would love to be on the show,love to try to win some money.someone that needed it.I cry when people win. I think the show is great and thanks for the people that started this show deal or no deal.Good luck to everyone. GOD BLESS YOU ALL.

deals2spot

This is a great site to find some good deals. The site does not seem to list a lot of them but the quality is great. I saved hundreds of this site.

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